Posted by on Oct 12, 2013 in Food For Thought |

Don’t Eat the Dog:

One year ago, as the crisp days of late Fall shortened toward winter, my fellow workers and I took a midmorning break from work in the forest.  The flip of the switch silenced the chainsaw’s snarl and with a final cough the rumble of the cat, with which we have been yarding logs, returned us to welcome quiet.  With the warmth of late fall sun on my shoulders I took in the view. Unlike the many days when we are working in a hollow where the most impressive view is a vine maple thicket or a rotting stump at close range, the view included a postcard-worthy sweep; the foreground was filled with the mosaic of the forested hillside to which our family holds legal title (from  day to day it is tough to tell whether we own it or it owns us).   Though my name has been on the list of owners for sometime, I find that the land’s  curves and tree-covered textures look somehow different to me since my wife and I took over management and majority ownership in recent years.  In the distance, beyond the family lands, across the Tualatin River as it  makes its transition from  coastal mountain stream to plain-traversing river, my view took in familiar forestlands on the ridges beyond.  In addition to occasionally providing inspiring morning break views like that morning’s, another perk of working on family forestlands is the opportunity for reflection and contemplation.  While at times working in the forests requires us to use every once of our limited brainpower, there are also occasions when the work allows chances for constructive contemplation. Enjoying the break from the morning’s  hard and loud work, sipping from a water  bottle kept cool by being  tucked against the trunk of a tall oak,   I mulled a difference in the forested lands across the valley.  The difference was not one that the eye could see, they look much the same, but instead a difference in their owners’ attitude toward the land’s future. To the right, where the coast range ridge descends to merge into the flat Tualatin Plains  I saw forests owned and cared for by  family operations much like our own.  To the left, where the ridges grow  higher and  steeper as they rise toward the Coast Range’s  crest, I saw lands whose ownership was recently transferred from an industrial timber company into the hands of a Timberland Investment Management organization – known as a TIMO for short.   The invisible contrast between the two  forests is something I know of from the comments and actions of the owners.  My fellow family forest owners across the valley look to the future of their forest with palpable uncertainty and concern.  For years they have worked to improve the land through the types of careful, challenging, effort which draws little attention, but leads to good results such as creeks running cooler and cleaner, and sold logs adding to the economic vitality of the local mill and community.  With the transition to the status of “senior citizen” further in the rearview mirror than they care to admit, the question of what will happen to the family forest when the passage of time brings their relationship with it to an end moves closer to the front of their minds every day.  Because their first preference is for the forest to stay in family ownership by having their daughter and son-in-law take over ownership and management, this is an option that has had plenty of discussion.  With the younger generation living and working less than an hour away and having a strong interest in the forest, the odds of continuing family ownership look good.  But in reviewing the forest’s finances with the rising generation he finds that their questions leave him with concerns.  When they point out the low annual financial  return  from the forest, the significant work required, and the high and rising investment value of the forest, he counters with his conviction that the fact that the annual return is well below what the equivalent funds would earn in a savings account is more than compensated for  by the rewards and satisfactions of being involved with the forest.  In his darker moments he wonders aloud “what’s wrong with the younger generation; don’t they care, don’t they know a good thing when they see it?”  At the same time, the daughter and son-in-law drive home from the review of the forest’s finances wondering “how can anyone consider this a good investment?  Even if we love the forest and the idea of providing family continuity by committing our lives to it, is this something that a reasonable person should do?”

 

Speaking of the questions of good investments, my gaze shifted to the left. The change of ownership that had recently taken place on our neighbor’s lands was not unique and, in fact, fits a pattern of aggressive purchases of forest lands throughout our region and country by distant and faceless investors.  Whether I hear it from the podium at conferences, in the pages of the press, or in investment prospecti, the message is the same “buying forestland is a smart investment”.  Looking at my watch I realized that  I had better be getting back to work before the boss (the fellow who looks  back at  me in the mirror) had reason to criticize me for too much thinking and too few logs on the landing.  I headed back to work wondering what might explain why many family forest neighbors question  the financial wisdom of forest ownership and  are uncertain about continuing while our industrial forest neighbors seem to have trouble buying  additional lands fast enough.

 

Now another year has passed and once again the declining rays of late fall sun warms my back as I take a break, savor the view across the valley, and  consider the future prospects of forest ownership for my family and our varied neighbors.  In the intervening year, I believe I have found the answer to the questions I puzzled over a year ago. Perhaps the answer to the question of why the young family forest land owner is cautiously uncertain of the wisdom of carrying on while those behind TIMOs and industrial ownership are not lies in the issue of their differing frames of reference.  For someone to tell a family forest owner who is committed to holding the land indefinitely that it is a wise investment is similar to a friend telling me that the choice to buy a golden retriever is a good one because its meat makes good eating and the dog’s coat could keep me warm in chilly weather.  The dog recommender’s frame of reference is based on my needing to terminate the relationship in order to get the value.  If I have no interest in eating or wearing the dog, those qualities of the dog are of no value to me.  I need to use a different frame of reference when I decide whether the dog is a good choice for me – characteristics such as companionship or pulling my sled, that don’t require ending my relationship with the dog.  Similarly, before accepting and acting on the advice that the purchase of forestland is a wise investment, I need to stop and consider the frame of reference of those providing the encouragement.  Is their judgment of value based on values which only come when we, the owners, sell the land and  terminate the relationship (eat the dog), or is their judgment of value based  on values that the owners benefit from without selling the land and ending the relationship?  Given these different frames of reference, it makes sense that our TIMO and other industrial forest neighbors are increasing their forest investments based on their frame of reference being the forest’s investment value, or the expectation that there will be a good financial return when they sell the land, even if the forest’s annual productive value – profit from selling logs – is low.  Looking to the family forestland to the east, I see that the hesitation that the rising generation of family forest owners are wisely showing when invited to carry on the family legacy and investment makes complete sense because of their frame of reference.  If they accept the invitation, they have no intention of selling the land – eating the dog.  For them, when considering the financial aspects of forest ownership there is only one form of value that matters – annual productive value –  the values that will come without selling the land.  In trying to understand this situation, it is a mistake to rely on explanations that are too simplistic.  For example, while many family forest owners see themselves as long term owners with no plans to sell, there are some that are as focused on maximizing short term speculative value as the most aggressive industrial owner.  Conversely, some industrial owners are as committed to long term ownership as any family forest owner.  Accordingly the distinction should more accurately be made between owners focused on speculative investment value (dog eaters) and those focused on long term productive value (non dog eaters).

 

Realizing that these days of late fall are increasingly short, I remind myself that I need to get back to work.  Before I go I sum up the morning’s break mulling by making notes to myself of three things I need to do:

1)      As people who recently accepted the invitation and responsibilities of carrying on owning and caring for family forests – and  as people with no interest in eating the dog – my wife and I need to find ways to boost the annual productive value enough to keep our choice to make this commitment from being a bad one.

2)      Secondly, when I hear others make the common statement that the investment in forestland in our region is a wise investment, I need to carefully consider the person’s frame of reference – dog eater or non dog eater?

3)      And finally, though my parents, wife and I like to consider the possibilities of our children carrying on our family’s interdependent bonds with this forest, we need to be realistic in assessing and communicating what is really involved, and in the time remaining on our watch, do everything we can to change the internal and  external economics of the situation such that we can responsibly encourage non dog eaters in the next generation to follow our path.

 

As I return the water bottle to the shady spot behind the big oak and head back to work,  my gaze moves beyond our forest and the neighboring forests to the more distant hills.  Though the hills are twenty miles away, I can still make out the transmission towers and outlines of the suburbs of Portland, where the steady creep of subdivisions eat up forested and farmed acres daily.  This vantage point reminds me that we’re involved with a place, time, and business where investment values of land are relatively high, rising, and will continue to rise, at the same time that the land’s productive value – what you can earn in a year from responsibly working it – is in too many cases relatively low, dropping and will continue to drop unless we take action. For those of us committed to responsibly growing things for a living, for those of us with no interest in developing a taste for dog, it seems that until we find ways to work with others to correct this skewed relationship between investment value and productive value, our lands and our livelihoods are at  risk.  I’d better stop writing and get to work; there is so much to be done.